Nikkei falls to more than 2-week low as China plunge rattles investors

Redacción de Reuters

3 MIN. DE LECTURA

* China-related stocks underperform

* Exporters hit by stronger yen as investors risk averse before Fed

By Ayai Tomisawa

TOKYO, July 28 (Reuters) - Japan's Nikkei share average dropped to a more than two-week low on Tuesday as investors worried that a fresh rout in Chinese shares would damage China's economy and as commodity prices tumbled.

The Nikkei share average fell 1.1 percent to 20,132.12 by mid-morning after falling to as low as 20,070.62, the lowest level since July 13.

The dollar was under pressure as China jitters spurred flows into safe haven assets such as the yen, while commodities including oil and copper weakened amid fears of a collapse in demand from China if the stock market rout damages the broader economy.

"Just like investors unwind their positions in the dollar and commodities, they avoid all risky assets including stocks," said Nobuhiko Kuramochi, a strategist at Mizuho Securities.

Market observers said that investors will stay jittery and see how China's regulators will try to counter the rout.

After Chinese stocks plunged more than 8 percent on Monday, the country's top securities regulator said Beijing would keep buying shares to stabilize the market as an unprecedented rescue plan already in place appeared to sputter.

Outperforming the market was ANA Holdings, which rose as high as 2 percent earlier after the Nikkei business daily reported that its April-June operating profit likely rose to the highest in seven years.